Q.1. Is loan allowed against security of NRE/FCNR deposit to depositor / third parties.

Ans. Yes. Loan upto Rs.100.00 lakh is allowed against the security of NRE/FCNR deposit to depositor and or to third parties.

Q.2. If loan against deposit can be availed to buy house/flat or commercial property.

Ans. Yes, RBI has granted general permission to NRIs/PIOs to buy flat/houses for own residential purposes.  Purchase of agricultural land, plantation property or farmhouse is prohibited. 

Q.3. How does one repay loan availed against deposit receipt?

Ans. Loan can be repaid from fresh inward remittance from abroad, proceeds of deposit receipt and from funds held in NRO account of the deposit holder. 

Loan facilities for purchase of house property in India.

Q.4.  Can NRI/PIO avail of housing loan from Authorised Dealer banks in India for purchase of residential accommodation or for purpose of repairs/renovation/improvement of residential accommodation? How can loan be repaid?

Ans. Yes, NRIs/PIOs can avail of housing loan from Authorised Dealer Banks in Rupees. Such a loan can be repaid (a) by way of inward remittance from normal banking channel or (b) by debit to NRE/FCNR (B)/NRO account or (c) out of rental income from such property; (d) by close relative of borrower, as defined in section 6 of Companies Act, 1956.